TY  - JOUR
T1  - Corporate Governance and Capital Accumulation: Firm Level Evidence from Italy
JF  - Scottish Journal of Political Economy
Y1  - 2009
A1  - Elston,Julie
A1  - Rondi,Laura
KW  - Finance
KW  - OSU-Cascades
AB  - This study investigates the impact of investor protection on firm ownership and investment decisions in a model where investor protection is allowed to vary across firms. Using firm panel data for Italy, we construct firm level variables to capture the degree of investor protection which is specific to the firm and observable by outside shareholders. Empirical evidence indicates that the stronger the investor protections the lower the fraction of equity that is owned by insiders. Results also suggest that higher insider equity ownership is linked to a larger risk premium and higher costs of capital for the firm. Finally, our findings indicate that the magnitude of capital stock distortions is important when shareholder protection is weak and ownership concentration is high.
VL  - 56
CP  - 6
U2  - a
U4  - 8489428993
ID  - 8489428993
ER  -